The struggling AI power startup Fermi is losing both its CEO and chief financial officer as it launches a “2.0” reset to attract customers for the largest data center campus project in the world in the rural Texas Panhandle.
Fermi, which is backed by former U.S. Energy Secretary Rick Perry, saw a massively successful IPO last year—before generating any revenue—that was quickly followed by a steep decline on the stock market as it lost its first planned hyperscaler customer and then saw its cofounder and CEO, Toby Neugebauer, reportedly engage in a public confrontation with U.S. Commerce Secretary Howard Lutnick.
Fermi’s market cap has fallen from nearly $20 billion in October down to $3.4 billion as of April 20, including a nearly 18% dip on news of the leadership changes.
Neugebauer, the son of retired Texas congressman Randy Neugebauer, will remain a board member and Fermi’s largest shareholder, but he’ll no longer have an executive position. Likewise, CFO Miles Everson has resigned but will sit on the board, the company said.
Fermi chairman Marius Haas said a new “office of the CEO” will lead the company while search firm Heidrick & Struggles helps identify a new CEO. The firm will work closely with Haas and two other board members—excluding Perry, Neugebauer, and Everson—to pick a CEO.
The interim office of the CEO will be led by Fermi chief operating officer Jacobo Ortiz and Anna Bofa, who is an observer on the board, and has industry experience with Google and Meta.
Fermi also will move its headquarters from Amarillo, Texas, to Dallas.
Fermi’s “Project Matador” plans are to build 11 gigawatts—enough to power 8 million homes—of nuclear, solar, and natural-gas fired power for a “HyperGrid” to support massive data center complexes on over 5,000 acres of land owned mostly by the Texas Tech University System. Much of the land is leased to the U.S. Department of Energy, which has publicly supported Fermi’s development.
Fermi even plans to name the West Texas project the Donald J. Trump Advanced Energy and Intelligence Campus.
Fermi said the leadership changes are part of the company’s “evolution as it continues to progress along its path to becoming a mature, established entity, well positioned for long-term, sustainable growth.”
The company declined further comment on Neugebauer’s and Everson’s departures from their executive roles. Neugebauer did not reply to messages seeking comment.
The potential upside
In a note, Stifel analyst Stephen Gengaro said Neugebauer’s “surprising” departure could prove to be a positive for the company.
Based on management’s comments touting “an acceleration in customer conversations” during the past few days, “it appears there was friction between potential customers and the outgoing CEO. It is possible that negotiations with customers could be smoother going forward,” Gengaro stated.
“While shares likely weaken on the headline, we believe this could be a plus for [Fermi],” Gengaro added.
In December, an unnamed Fermi tenant canceled a $150 million deal for the data center campus. Fermi had planned to secure an anchor tenant by March, which has yet to occur.
The news also follows reporting by Politico in March that Neugebauer and Commerce Secretary Lutnick publicly clashed at the Nvidia GTC conference in San Jose.
Neugebauer reportedly complained to Lutnick about plans for U.S. trade deals with South Korea and the blocking—or slow-playing—of direct Korean investments in Fermi’s project. Fermi already is partnered with South Korea’s Doosan Enerbility and Hyundai Engineering & Construction on the development of its nuclear reactors.
At the time, Neugebauer denied being “loud and belligerent” and admitted only to having a “direct conversation” with Lutnick about perceived interference in Fermi’s progress, according to Politico.
Unrelated to Fermi, Neugebauer also has an ongoing legal feud with prominent billionaires Peter Thiel and Ken Griffin over his failed “anti-woke” banking business, GloriFi. Citadel’s Griffin, Thiel, the cofounder of PayPal and Palantir Technologies, and other prominent names were significant financial backers of GloriFi.
The Wall Street Journal previously reported that GloriFi suffered from a chaotic work environment, highlighted by allegedly erratic behavior from Neugebauer.
Neugebauer, who is best known for cofounding the energy-focused private equity firm Quantum Energy Partners, now Quantum Capital Group, shut GloriFi down in 2022 when it ran out of money. The company filed for Chapter 7 bankruptcy protection in early 2023.
